Question 1

What happens when the interest-only period ends?

Accepted Answer

Your payment jumps because principal amortizes over the remaining loan term. Most borrowers refinance or sell before this happens.

Question 2

Can I pay principal during the interest-only period?

Accepted Answer

Yes, most lenders allow extra principal payments without penalty. You're only required to pay interest monthly.

Question 3

Do interest-only loans work for primary residences in Westmorland?

Accepted Answer

They can, but lenders prefer investment properties. Expect stricter qualification if you're buying a primary home with interest-only terms.

Question 4

How do interest-only rates compare to conventional loans?

Accepted Answer

Rates run 1-2% higher due to non-QM pricing. The payment advantage comes from deferring principal, not a lower rate.

Question 5

What credit score do I need for interest-only in Imperial County?

Accepted Answer

680 is the floor for most lenders. Some go lower with larger down payments or stronger reserves.

Interest-Only Loans in Westmorland: Lower Payments for Investors and Self-Employed